Tablets, which rank high on many consumers’ shopping lists, have become
an undisputed highlight for this year's peak season, with cheap,
under-$200 devices poised to gain major attention within the market.
Considering how Google and Amazon are able to resort to advertising
costs and other means to make up for their tablets' low prices, the PC
vendors who traditionally rely on hardware sales for profit will be in
for some serious competition. TrendForce's research has indicated that
as far as hardware costs go, the retail prices for 7-inch tablets are
unlikely to drop any lower than the current pricing. The replacement of
key component parts, at the moment, serves as the only viable option for
PC-branded manufacturers who are seeking to reclaim their market
positions through low-pricing strategies.

Given that the display panel and touch module each account for
approximately 35~40% of a tablet's total material cost, they are,
naturally, major targets when it comes to cost control. With the
replacement of the FFS panel with the TN panel and the use of the G/F/F
touch modules, a tablet will be able to trim off an estimated $25 from
the overall cost.

When it comes to minimizing memory component costs, commodity DRAM is
perceived as an ideal option, for the 1GB version costs only around
$3.5, approximately 65% less than its mobile counterpart. With regards
to NAND Flash, with the 8GB and 4GB eMMC costing $6 and $4,
respectively, the 4GB version is likely to be a preferred choice for
many manufacturers. In terms of CPU, provided that the low-priced
tablets utilize processor components from China-based manufacturers,
TrendForce estimates that the cost per chip will only be around $12,
which is approximately half that of the high-end tablets' $24-range
processors.

CIO, CTO & Developer Resources

As TrendForce indicates, whether the potential low cost tablets will
indeed become a major hit remains to be seen, for much of their quality
and specs will likely be affected by the costs of the materials used.
Nonetheless, should PC-branded manufacturers release tablets that cost
less than $150, this will certainly put a lot of pressure on China's
white-box tablets makers, and in turn intensify the pricing competition
in the 2013 tablet market.

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